Wednesday 6 October 2010 14.43 EDT
First published on Wednesday 6 October 2010 14.43 EDT

Tony Blair has called for a "revolution in thinking" on international counter-terrorism, saying the "paucity" of the west's efforts have left it "outspent, outmanoeuvred and out-strategised" by Islamist extremism.

Speaking in New York to a thinktank, the Washington Institute for Near East Policy, Blair said a failure to challenge the "narrative" that Muslims were oppressed by the west was fuelling extremism around the world. Instead, the majority had accepted the idea that military interventions since the 9/11 attacks were an explicit attack on Muslims. "The practitioners of extremism are small in number. The adherents of the narrative stretch far broader into parts of mainstream thinking," he said.

Blair explained how he regarded the narrative: "It is that Islam is basically oppressed by the west; disrespected and treated unfairly; that the military action we took post-9/11 was against countries because they are Muslim; and that in the Middle East we ignore the injustice done to the Palestinians in our desire to support Israel, because the Palestinians are Muslims, and the Israelis Jews. It is a narrative that now has vast numbers of assembled websites, blogs and organisations."

Since stepping down as prime minister, Blair has represented the quartet – the UN, US, EU and Russia – working to resolve the Israeli-Palestinian conflict. He has also worked to raise the profile of counter-terrorism since the threat of terrorist attacks marked the last years of his premiership and his efforts to bring in tough legislation were defeated by his party.

"The irony is that the many Muslims who believe passionately in co-existence and tolerance are not empowered but frequently disempowered by our refusal to confront the narrative. We think if we sympathise with the narrative – that essentially this extremism has arisen as a result, partly, of our actions – we meet it half way, we help the modernisers to be more persuasive. We don't. We indulge it and we weaken them.

"Worse, a reaction springs up amongst our people that we are pandering to this narrative and they start to resent Muslims as a whole. This is because implicit in this indulgence is an acceptance of the argument that Islam and, for want of a better term, 'the west' are in conflict."

Blair admitted he still found the judgment difficult. He said: "The policy choices from 9/11 onwards were and are immensely difficult. Eventually they come down to: do we confront this extremist ideology in order to change it, or do we manage it and hope, in time, it changes itself? I still find this judgement hard to make. On balance, however, I don't believe that it can be benignly managed out of existence. Its roots are too deep, its narrative too pervasive."